Profitability of Celebrity Cruises?

[Quo Vadis?]

Is there any source that gives a breakdown of the profitability of the various subsidiaries of RCCL.  I'm just curious if Royal would try to sell some cruise ships or a division to keep the rest of the fleet afloat?

[mafig]

I don't have an answer, just a guess:  Azamara.

 

LOL on your Interests:  Getting our money back.😁😀

[ECCruise]

I can't see it anywhere on their P & L reporting.  They would not be required to break out that information so I would guess they would not.

Agree Azamara likely the biggest profit driver as a percentage, but not total.

[Banjo]

I know of a owner of a B&B in Western North Carolina that used to work in a management position for RCCL at the headquarters in Miami. He is a chef by trade and helped develop the menus. I had him cater an affair for us a year ago in one of the B&B dining rooms. Learning that we cruised a lot on Celebrity he laughed and said: "Royal makes the money and Celebrity spends it"

[Baron Barracuda]

On 4/18/2020 at 11:44 AM, Argo. said:

Is there any source that gives a breakdown of the profitability of the various subsidiaries of RCCL.  I'm just curious if Royal would try to sell some cruise ships or a division to keep the rest of the fleet afloat?

Royal releases virtually no division level information other than passenger counts.  Depending on how the parent company allocates items like interest expense and corporate overhead X's profitability is pretty much whatever parent RCCI wants to show.

[Jim_Iain]

I've never seen a breakdown of RCL by subsidiary.    I would have to say that as a whole RCL has been very profitable.  Just look at Fain's Salary and Compensation Package of $12 Million a year.  Much of that was a performance package.

[NutsAboutGolf]

1 hour ago, Jim_Iain said:

I've never seen a breakdown of RCL by subsidiary.    I would have to say that as a whole RCL has been very profitable.  Just look at Fain's Salary and Compensation Package of $12 Million a year.  Much of that was a performance package.

 

Thanks!  I researched and found this: https://www.seatrade-cruise.com/news/rcl-ceo-fains-2019-compensation-topped-14m

 

[Jim_Iain]

55 minutes ago, NutsAboutGolf said:

 

Thanks!  I researched and found this: https://www.seatrade-cruise.com/news/rcl-ceo-fains-2019-compensation-topped-14m

 

Lisa isn't doing to bad either -

 

Lisa Lutoff-Perlo

The total compensation for Lisa Lutoff-Perlo, president and CEO, Celebrity Cruises, was $4.43m, up from $3.84m. Lutoff-Perlo's salary went to $770,769 from $688,462, and stock awards were worth nearly $2.28m, up from $1.79m. Her cash bonus of nearly $1.1m compared to almost $1.23m the year before. 'Other compensation' was $142,114.

[wrk2cruise]

3 hours ago, Jim_Iain said:

nd stock awards were worth nearly $2.28m, up from $1.79m.

 

Stock options not worth as much today

[ipeeinthepool]

5 hours ago, wrk2cruise said:

 

Stock options not worth as much today

 

That's an understatement.

[TeeRick]

On 4/18/2020 at 11:44 AM, Argo. said:

Is there any source that gives a breakdown of the profitability of the various subsidiaries of RCCL.  I'm just curious if Royal would try to sell some cruise ships or a division to keep the rest of the fleet afloat?

Argo- I'm not sure that even if this info were available it would help RCCL in these decisions.  The profitability info would be based on the past state of the cruise industry.  Probably would not really apply to the go-forward state of the industry and what might be profitable or not.  RCCL's issues are centered in the very negative cash flow due to all of their new ships and ongoing builds of new ships in all of their divisions.  It is hard to imagine there would even be a market to sell off a brand new expensive ship like APEX right now or in the foreseeable future.  Or Odyssey of the Seas.  They are in a very tough spot business wise.  

[az_tchr]

13 hours ago, Jim_Iain said:

Lisa isn't doing to bad either -

 

Lisa Lutoff-Perlo

The total compensation for Lisa Lutoff-Perlo, president and CEO, Celebrity Cruises, was $4.43m, up from $3.84m. Lutoff-Perlo's salary went to $770,769 from $688,462, and stock awards were worth nearly $2.28m, up from $1.79m. Her cash bonus of nearly $1.1m compared to almost $1.23m the year before. 'Other compensation' was $142,114.

Her bonus for 2020 will be zero or close to it.  Those $2.2M of stock awards are worth about $500K today.

The name of the game is to cut staff and cash burn.  Get the crews home and the cash burn can get to about $200M a month.

They are in a good cash position today and for say until October.  Their unique problem is what assets can they reasonably sell?  Cruise ships are not exactly a hot item for investors today.

If the CDC is correct and Corona becomes active along with normal flu there will be no cruising until there is a vaccine - spring 2021 at the earliest.  Resumption of cruises cannot happen under any possible guidelines for COVID.

[Jeremiah1212]

2 hours ago, TeeRick said:

  It is hard to imagine there would even be a market to sell off a brand new expensive ship like APEX right now or in the foreseeable future.  Or Odyssey of the Seas.  They are in a very tough spot business wise.  

 

 

I think in the same sense that decade old A380's were sold for scrap and parts, several of these ships will be sold for scrap. If there are any more setbacks for the industry, many ships will be more valuable as scrap. I don't foresee anyone being eager to buy a gently used Oasis class ship anytime soon!

[Baron Barracuda]

15 hours ago, Jim_Iain said:

Lisa isn't doing to bad either -

 

Lisa Lutoff-Perlo

The total compensation for Lisa Lutoff-Perlo, president and CEO, Celebrity Cruises, was $4.43m, up from $3.84m. Lutoff-Perlo's salary went to $770,769 from $688,462, and stock awards were worth nearly $2.28m, up from $1.79m. Her cash bonus of nearly $1.1m compared to almost $1.23m the year before. 'Other compensation' was $142,114.

 

Saw in an SEC filing that LLP sold 5,000 RCL shares this week @ $36 reducing her holdings to 50,000 shares.  Not exactly a vote of confidence in company.

[Baron Barracuda]

2 hours ago, TeeRick said:

 It is hard to imagine there would even be a market to sell off a brand new expensive ship like APEX right now or in the foreseeable future.  Or Odyssey of the Seas.  They are in a very tough spot business wise.  

Might consider sale - leaseback of ships not currently pledged as collateral.  

[jwc1027]

15 hours ago, Jim_Iain said:

Lisa isn't doing to bad either -

 

Lisa Lutoff-Perlo

The total compensation for Lisa Lutoff-Perlo, president and CEO, Celebrity Cruises, was $4.43m, up from $3.84m. Lutoff-Perlo's salary went to $770,769 from $688,462, and stock awards were worth nearly $2.28m, up from $1.79m. Her cash bonus of nearly $1.1m compared to almost $1.23m the year before. 'Other compensation' was $142,114.

Well she just sold stock on 4/19 at approx $36/per share. Doesnt instill a lot of confidence in regard to future of Celebrity.

[jelayne]

1 hour ago, jwc1027 said:

Well she just sold stock on 4/19 at approx $36/per share. Doesnt instill a lot of confidence in regard to future of Celebrity.

Maybe she needed the $ to offset the 25% salary cut she and other exec's took.  Selling less than 10% isn't a lot.  

[Baron Barracuda]

3 hours ago, jelayne said:

Maybe she needed the $ to offset the 25% salary cut she and other exec's took.  Selling less than 10% isn't a lot.  

Even if $180k sale isn't a big deal to her the optics are poor.  She is an insider with access to non-public information.  If she believed company will rebound would expect her to be buying stock that is down 75%.  Even with the pay cut her base salary alone is over a half million $. 

[Von & John]

The question is whom did she sell the stock to?

Was it a family member or friend as a gift at that value?

Or on the open market...

If on the open market now seems like a very odd time to sell!!!

[ipeeinthepool]

16 hours ago, jwc1027 said:

Well she just sold stock on 4/19 at approx $36/per share. Doesnt instill a lot of confidence in regard to future of Celebrity.

 

LLP likely sold the stock to book a loss in order to offset other income and reduce her taxes.   Probably a reasonable thing to do.  I suspect that she still has a lot of stock.

Edited April 23, 2020 by ipeeinthepool

[TeeRick]

Key Executives in large public corporations trading on the US stock exchange need to exercise stock options or buy/sell stocks in a very limited pre-determined and restricted time window and by very specific rules determined in the US by the SEC.  Some options become due- sell them or lose them.  There are also tax issues as mentioned by ipee previously.  Everything has to be in the public record.  No reason to believe LLP is doing anything wrong or sending a message here.

 

https://www.investopedia.com/articles/stocks/07/10b5-1.asp